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Vietnam has attracted around US$1.2 billion in foreign direct investment so far this year, down 22.5 percent compared to the same period last year.

The country licensed 148 new projects to foreign investors with a combined capital of $712 million, a drop of 4.3 percent, according to the Foreign Investment Agency.

It also allowed 58 existing projects to boost registered funding by a total $480.5 million, down 32.2 percent.

The agency did not provide any explanation for the decline. The nine-day Lunar New Year festival last month could be one of the reasons.

Among 27 countries and territories investing in Vietnam in January-February, British Virgin Islands was the biggest investor with $351.39 million, making up 29.5 percent of the total pledges.

The tax haven has initiated a luxury clothing production project that alone is worth $300 million.

It is followed by South Korea, with $222.11 million, and Japan, with $169.83 million.

The top areas for foreign investment in the first two months are process engineering, real estate, wholesale and retail.

Ho Chi Minh City is still the country's major investment magnet with $498 million, accounting for 41.7 percent of the total figure, followed by Hai Phong City with $213.86 million and Binh Duong Province with $134.04 million.

The Foreign Investment Agency said foreign investors have disbursed $1.2 billion as of February 20, up 7.1 percent.